Reed’s, Inc. to Launch New Diet Soda Line for Virgil’s Brand;
-Pre-Announces Sales for Fiscal Year 2006-

Reed’s, Inc. (OTCBB:REED)announced today that it plans to launch new diet versions of the Company’s Virgil’s Root Beer and Cream Sodas in the second quarter of 2007.

Chris Reed, Founder and CEO of Reed’s stated, “We are extremely excited to announce the addition of the diet soda line for the Virgil’s brand. The addition of the diet line to our product portfolio will allow us to reach a larger audience, further expand our distribution network and drive top line growth for 2007 and beyond.”

The new product launch will include diet versions of Virgil’s Cream Soda, Black Cherry Cream Soda and Root Beer sweetened with Splenda. The product will be distributed through mainstream supermarkets and warehouse clubs such as Costco Wholesale Corp.

Additionally, the Company pre-announced sales for the fourth quarter and year ended December 31, 2006. For the quarter ended December 31, 2006, sales increased 10.1% to $2.6 million, from $2.3 million for the same period last year. For the year ended December 31, 2006 sales were $10.5 million, a 10.7% increase from $9.5 million for the prior year.

This release contains “forward-looking statements” that include information relating to future events and future financial and operating performance. Examples of forward looking-statements include Reed’s expectations of future growth. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to: Reed’s ability to generate sufficient working capital to support its growth, Reed’s ability to develop successful new beverage products, the highly competitive nature of the beverage industry, Reed’s dependence on significant customers with whom it does not have long-term purchase commitments, dependence on third party distributors to distribute Reed’s beverages and other products, and other information that may be detailed from time to time in Reed’s filings with the United States Securities and Exchange Commission. For a more detailed description of the risk factors and uncertainties affecting Reed’s, please refer to the Company’s recent Securities and Exchange filings, which are available at www.sec.gov. Reed’s undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise